Republicans find a new target: ObamaCars

After a year’s success in casting bankrupt solar maker Solyndra as the prototype for President Obama’s energy policies, Republicans now are targeting what they have dubbed “Obamacars.”

For some GOP members of Congress, the Chevy Volt, made by General Motors, is a fire hazard and a job loser, while Tesla Motors is a crony capitalist purveyor of toy cars for Silicon Valley millionaires.

The campaign has tainted Energy Secretary and UC Berkeley physicist Steven Chu and his agency’s renewable energy loan programs, rupturing a consensus under former President George W. Bush, who started the programs to end America’s addiction to oil.

But it may not stop the electric car. The assault has enraged General Motors. On March 1, the company opened an unprecedented campaign to re-introduce the Volt in California, the biggest U.S. auto market, even as it temporarily halted production because of slow sales.

‘It’s all on us’

GM Chief Executive Officer Dan Akerson has complained about the political atmosphere that surrounds the Volt.

“Sometimes I feel bad for President Obama,” he said this month after an appearance at the Commonwealth Club in San Francisco. “This car was designed and committed to well before he was president, and it’s called the ‘Obamacar.’ It’s not the Obama car. I’m proud and I’m pleased that he thinks highly of it, but it’s all on us. It’s not a political issue.”

The automaker accused Republicans and the media of hyping claims that the car caught fire during testing, which forced temporary layoffs at the Volt plant in Detroit.

Tesla, which received a $465 million Department of Energy loan, has dropped pursuit of new federal loans, raised private cash and plans in July to start deliveries of its $50,000 S car, claiming it is on its way to the mass car market.

“We applied during the Bush administration, and we were approved under the Obama administration, so as far as we’re concerned, we at least had a bipartisan relationship for the loan,” said Tesla spokesman Ricardo Reyes. “We got one of first loans and we used it to build the car that is now going into production in a U.S.-based facility. … I’d like to think we’re pretty much a case study on what the loan program was designed to do.”

Showing photos of a charred Volt, a panel of the House Government Reform and Oversight Committee, chaired by Rep. Darrell Issa, R-Vista (San Diego County), held a hearing in January called “Volt Vehicle Fire: What Did NHTSA Know and When Did They Know It.”

But no Volt has caught fire on the road. There are no recalls. The car was deemed safe by the National Transportation Safety Board. The fire occurred during testing and was likely the result of testers at the safety board failing to drain the battery of a mutilated test vehicle before storing it.

By comparison, 258,500 gasoline vehicles caught fire between 2004 and 2006, according to federal statistics.

‘Blatantly wrong’

“Without a doubt, the antics have hurt sales, which has probably contributed to the need to shut down the plant for a few weeks and temporarily lay off 1,300 employees,” said GM spokesman Shad Balch. “It’s just blatantly wrong information. You get some of these folks on national news shows making outrageous statements about batteries catching on fire and cars randomly exploding.”

Bob Lutz, a UC Berkeley business school graduate who championed the Volt when he was vice chairman at GM, wrote in his blog, “the loony right has its jaws sunk into the Volt with all the stupid determination of a terrier who has locked his teeth into the mailman’s butt. And with the same result: painful, but without any useful purpose.”

An independent analyst at TrueCar.com, a new-vehicle pricing and research firm, said what is slowing Volt sales is GM’s failure to tout its economics as gasoline prices soar past $4 a gallon.

Jesse Toprak, vice president of market intelligence for TrueCar.com, a vehicle pricing and research site, said he lives in Tarzana (Los Angeles County) and commutes about 17 miles to his office in Santa Monica. He test drove a Volt for one week.

“Did not use a drop of gas,” Toprak said. “Charged it every night. Normally I would spend about $80 on gas every week.” He said it cost him $1 a day to charge the Volt, using night-time electricity pricing. That’s $30 a month, versus $320 for gasoline.

In addition, the federal government offers a $7,500 tax credit and California offers a $1,500 tax credit on top of that. California Volts also get an HOV lane sticker. That helped transform the hybrid Toyota Prius from a Hollywood toy to a mass-market vehicle.

Tightening up on loans

The Energy Department’s loan programs have been plagued by politicization, bankruptcies and bureaucratic bungling. Auto and battery makers have complained that since the Solyndra debacle last summer, the Energy Department has all but halted its loans. Department spokesman Damien LaVera denied the charge, saying the loan standards are unchanged.

Electric car maker Fiskar Automotive of Anaheim, which produces the luxury Karma in Finland and is aiming to produce a mass market “Project Nina” car in the United States, was approved for a $529 million loan guarantee. But it has drawn down just $193 million and was blocked in May by the Energy Department from further disbursements for failure to meet project milestones. It has stopped work at its Delaware plant.

Outdoing hybrid cars

Toprak of Truecar.com said the 18,000 electric cars sold in the United States last year, mostly the Volt and the Nissan Leaf, make up just one-tenth of 1 percent of new car sales.

Still, electric cars are outperforming the first-year introduction of hybrids, said Roland Hwang, the San Francisco-based transportation program director for the Natural Resources Defense Council, an environmental group.

“If the electric vehicle market is dead, then why did Toyota start to deliver a plug-in Prius a week and a half ago?” Hwang said. “Why will Ford this year enter the market with a pure battery Ford Focus? Honda is coming to market with a pure battery Fit subcompact. BMW’s Active E is an electric version of their One series and it’s sold out here in California.”

GM’s Balch said the company is pinning its strategy on California. For the first time, GM will give select consumers, including some in the Bay Area, a chance to live with the Volt in hopes that they will sell by word of mouth.

“We’re doing some pretty extreme customer demonstration programs,” Balch said. “The best way to sell this car is to let people live with it. So we have a fleet of demo cars out here that we literally will send to somebody’s house and let them live with it, so that they fully understand it, and buy one and become an advocate. It’s a very aggressive experiential marketing campaign.”